Finance Minister delivers his welcome message during SiGMA Cura?ao

Cura?ao’s Minister of Finance, Javier Silvania, today delivered his welcome message during the first day of SiGMA Cura?ao, an event hosted by the Ministry of Finance in association with SiGMA.

Here you may find the Minister’s message in its entirety.

Good afternoon, firstly I’d like to thank you all very much for gathering here today at the Cura?ao’s very first gaming industry event. I am aware that this room is a mosaic of opinions, interests, and backgrounds, both local and international. From existing B2C operators to entrepreneurs, service companies, lawyers, games and platform developers and even those who have reservations about this legislation.

Our primary objective during this event is to dissect the practical implications of the proposed gambling process. This is not just a matter of regulatory updates or financial benefits. This is about shaping the future of Cura?ao as a jurisdiction in a way that is transparent, accountable, and prosperous.

To those who have apprehensions about this legislation – I hear you. Changes are always met with skepticism, especially when they impact long-established practices. However, for all the operators out there our intent is not to disrupt, but to elevate.

I understand the varied business types represented here today. Each one of you plays a pivotal role in shaping the contours of our entertainment landscape. While our visions may differ, our end goal remains the same – ensuring that Cura?ao thrives.

Before I delve into the rationale behind the new legislation and the changes in our gambling landscape, I want to take a moment to congratulate Daniel Leandro Giraldo Soto on winning the trophy at the WPT Cura?ao Invitational tournament last night.  

Moreover I want to thank the World Poker Tour by putting on such a prestigious event as an explicit and unwavering show of support for the major undertaking of revitalizing the jurisdiction of Cura?ao.

Now I would like to move on to the three fundamental reasons as to why the new legislation and processes are not only for the good of Cura?ao as a gambling jurisdiction, but also for Cura?ao as a country.

These are:

• Economic Benefits
• Social Benefits
• Reputational Benefits

Economic

Cura?ao is the largest jurisdiction in terms of operator numbers, yet the public purse and the people of this island do not get even a fraction of what they deserve, given the staggering amount of revenue that flows through the island.

I think the best way to demonstrate this is to give you a visual example. 

In 2022, the Malta Gaming Authority reported licensing revenues of EUR 82 million.  That is 82 million just from fees to the authority.   During the same time period of one year the Cura?ao government and Gaming Control board were entitled to the approximate amount of EUR 250,000

These figures are correct.? 82 million versus 250,000.?

This contrast in numbers offers a sobering insight into the different trajectories and priorities of these two jurisdictions. It’s crucial for Cura?ao to evaluate its long-term strategy. Does it want to continue being the go-to for cheap and easy licenses or does it want to step up its game, increase its revenue, and simultaneously potentially provide better protection and benefits for both its operators and its citizens?

An alternative approach to consider is the broader contribution to the economy at large.  In a well-managed gambling jurisdiction the direct revenues to the regulator are only the tip of the iceberg.  The overall impact is monumental and demonstrates the real potential value to the economy.

The key driver of any gambling regulation is the gaming operations themselves, however the generation of economy in the sub-sectors can change not just the revenue to the gaming authority but indeed the overall economy on the island.

Firstly there are the mandatory services such as corporate, banking, internet services to support the gaming operations themselves. 

Along with that there are additional financial incomings – this includes property leasing for more local and expat employees, international bandwidth connections to other jurisdictions and markets, software development, training and education, not to mention of course the obvious one which is of course increased local employment.

And that is not all, evidence has repeatedly shown in other jurisdictions – very similar to ours – that the ripple effect runs even deeper – including retail and hospitality, financial, foreign spending and local hardware/equipment vendors.

Online gaming has been a game changer for the economies of small states such as Malta, Philippines, Gibraltar, Isle of Man, Alderney and Cura?ao. In the case of Malta, online gaming has transformed the Island’s economy since it was introduced in 2014 as it depend primarily on tourism to a diverse economy that includes hospitality, property, financial services and IT services. In 2019 online gaming generating a total of €1.65bn into the Maltese economy, that is, more than 12% of the total year’s GDP. Figures have dipped since Covid had an impact; however the economic impact is undeniable.

Comparatively although the Isle of Man does not publish figures at the same depth as Malta, there are records of e-Gaming accounting over 20% of GDP – a value of approximately GBP 1 billion.

Social

When it comes to the social benefits let us discuss the impact on work and employment. The intent of our efforts to revitalize the legislative landscape is to develop Cura?ao as a centre of excellence in the gambling industry.  This pushes envelope for employment opportunities and in fact there a many individuals and businesses out there who have no idea of the opportunities that are coming their way.

Now, envision a scenario where our local educational institutions, including our prestigious university incorporate industry specific training. Students could be offered tailored courses, internships, and training programs, paving the way for a future career that boasts of specialized skills that don’t now exist on the island. Such symbiotic relationships not only benefit the students and the establishments but also raise the profile of our education system.

Next, let’s talk about the development of business areas. The establishment of such entertainment hubs often leads to the rejuvenation and development of the surrounding areas. Take, for instance, DMO and Otrabanda. As these zones thrive, they attract other businesses, from restaurants to retail shops, creating a ripple effect of economic growth, development, and urban revitalization.

Moreover, with the growth of these hubs, there’s an inherent need for skill development. This doesn’t mean just training those who wish to join the gambling sector, but it offers an opportunity for the broader population to upskill. Whether it’s courses in customer service, cybersecurity, or finance, the range of skills that the population can acquire, and master is boundless.

Therefore as we consider the future of gambling legislation in our country, we have the chance to boost employment, enhance our education system, rejuvenate business districts, and upskill our citizens, ensuring that our community doesn’t just grow, but thrives.

Reputational

Right now Cura?ao is not highly regarded as a gambling jurisdiction.  This is a well-known issue, and has been discussed at length.  And quite simply the new legislative landscape will change that. So I would like to move on to something more important that is at play here. 

Gambling is classified as a high risk industry.  And the FATF the worlds financial action task force pays specific attention to it when evaluating countries positions on the White Grey or Black listing scale.

Recently Gibraltar was placed on the Grey List with FATF saying at the time that Gibraltar’s status as a major gambling hub was a significant factor in its decision. In particular the FATF criticized the government’s failure in “applying sufficient fines for anti-money laundering failings”.

AML is a key criteria of financial evaluations, one of which Cura?ao will be subject to next year.  And let me be very clear about it, the likelihood of us being placed on the grey list because our lack of AML legislation within the gambling sphere is real, and it is worrying.

The implications of being grey listed are far-reaching and touch upon various sectors of our nation. Let me walk you through some of the profound consequences we might face:

Firstly there will be a general negative perception that AML failings will not be the only ones that relate to commonly identified international standards – in short, the no smoke without fire view of us.

Governments may decide to restrict trade with us or connected entities or prohibit trade altogether.

Firms and banks will need to undertake heightened due diligence which will also negatively impact business and cross border trading which may increase prices, bargaining power and the cost of securing and servicing debt.

International aid if needed would see fewer potential sponsors.

Government revenues from local businesses would be negatively impacted.

International bond and loan markets would be regarded negatively meaning governments and private sector would have severe challenges in raising capital.

None of this is good. And all of it is avoidable. We absolutely and categorically need to take the steps necessary to prevent grey-listing and the LOK provides the safety net that we desperately need. 

In conclusion I would like to say that “change is the only constant”, and in the face of change, we have two choices – resist or adapt. I believe in the resilience and adaptability of the Cura?ao spirit. Together we can create a future where Cura?ao can shine as a beacon of responsible gaming in the Caribbean.